News: New pricing model for Greater Southern Waterfront flats

Sep 20, 2019

Wong explained that the new measures are aimed at providing “a better balance between new and resale (flats) in terms of grants”

In a bid to mitigate the “lottery effect” of securing a subsidised flat within the Greater Southern Waterfront, Minister for National Development Lawrence Wong revealed that the government is working on a new pricing model for public housing in such area.

Prime Minister Lee Hsien Loong had announced at the National Day Rally plans to build 9,000 public and private homes on the site of Keppel Club once its lease expires in two years.

“If you have public housing in such a prime area and if you were to sell it at today’s public housing prices, it will be a very large subsidy. Whoever gets the flats there, by ballot, will be very happy. But it will be a bit of a ‘lottery effect’. Those who don’t get that flat will be very envious,” he said during a CNA938 interview.

“On the other hand, if we were to keep the subsidy the same, then the price of those flats will be very high and out of reach. So we have to work out a new model for public housing in the Southern Waterfront. That’s something we are working on,” he added.

At the interview, Wong also discussed the new housing grant and higher income ceiling introduced by HDB, reported CNA.

Wong explained that the new measures are aimed at providing “a better balance between new and resale (flats) in terms of grants” in order that the percentage of individuals purchasing those properties “will stabilise going forward”.

Currently, around 75 percent of HDB buyers prefer new flats, while the other 25 percent opt resale flats.

“I expect with the incentive structure now adjusted, the 75 percent figure will likely come down in the coming years,” said Wong.

He added that the government also decided to raise the income ceiling to accommodate rising income levels.

“As incomes rise, a few of them at the margins will then exceed the income ceiling and then they would no longer have the chance,” said Wong.

“So we monitor the income ceiling all the time and as incomes rise, we will adjust the income ceilings accordingly so that about eight in 10 or more than eight in 10 Singaporeans will be eligible to buy public housing in Singapore.”

The income cap for families purchasing Build-to-Order flats was raised from $12,000 to $14,000, while the ceiling for singles aged 35 and above was increased from $6,000 to $7,000.

Victor Kang, Digital Content Specialist at PropertyGuru, edited this story. To contact him about this or other stories, email victorkang@propertyguru.com.sg